IC02 - LICENTIATE - Practice of Life Insurance 23
IC02 - LICENTIATE - Practice of Life Insurance 23
Q 1. Why is the tabular premium charged per annum less for a longer-term policy compared to a shorter-term policy?
A) Longer-term policies have higher risk profiles
B) Longer-term policies require higher premium amounts
C) Shorter-term policies have higher administrative costs
D) Longer-term policies have lower administrative costs
E) Shorter-term policies are more popular among customers
Q 2. Why do insurance companies prefer an annual premium payment mode?
A) It reduces the administrative charges for the company
B) It increases the risk of default on premium payment
C) It allows for higher interest earnings on the premium amount
D) It provides flexibility in premium payment frequency for policyholders
E) It lowers the overall premium amount for policyholders
Q 3. Which factor determines the risk associated with an insurance policy?
A) Age of the insured individual
B) Medical condition of the insured individual
C) Sum assured of the insurance policy
D) Type of insurance plan chosen
E) Mortality table used by the insurance company
Q 4. What is the premium amount after deducting the rebate on the sum assured?
A) Rs 32.50
B) Rs 32.02
C) Rs 30.52
D) Rs 1.50
E) Rs 1831
Q 5. What is a premium in the context of insurance?
A) The benefit received from the insurance company
B) The risk associated with the insured individual
C) The amount paid by the insured to the insurance company
D) The coverage provided by the insurance policy
E) The financial models used by actuaries
Q 6. What is the purpose of life insurance plans?
A) To accumulate wealth for retirement
B) To provide financial security in case of untimely death
C) To fund child education and marriage expenses
D) To cover medical expenses
E) To provide guaranteed returns on investment
Q 7. What does an Endowment Assurance Plan provide in case of the insured person's death?
A) No payment is made to the nominee/beneficiary.
B) The sum assured is paid at the end of the policy term.
C) The sum assured is paid to the nominee/beneficiary.
D) The premium payments are refunded to the insured person.
E) The plan is terminated and no benefits are paid.
Q 8. What is the main characteristic of a single premium term plan?
A) Premiums are paid at regular intervals throughout the policy term
B) Premiums are paid as a lump sum at the beginning of the policy
C) Premiums decrease over time as the risk decreases
D) Premiums increase over time as the coverage expands
E) Premiums can be paid monthly, quarterly, semi-annually, or annually
Q 9. What is the distinguishing feature of a money-back insurance plan?
A) Regular income during retirement
B) Lump sum payment on maturity
C) Partial survival benefits paid at regular intervals
D) Higher sum assured for a shorter term
E) Flexibility in premium payments
Q 10. Who can benefit from joint life insurance plans?
A) Single individuals looking for long-term coverage
B) Business owners seeking insurance for their company assets
C) Couples who want to ensure their children's education expenses
D) Retirees who need income protection in their later years
E) Married couples or business partners in need of life cover for two lives
Q 11. When will the deferred date be in Jagat's child insurance plan?
A) On his 2nd birthday
B) On his 7th birthday
C) On his 18th birthday
D) On the policy anniversary after his 7th birthday
E) On the policy anniversary after his 18th birthday
Q 12. What are some of the funds available for investment in a ULIP?
A) Equity Fund
B) Debt Fund
C) Balanced Fund
D) Money Market Fund
E) All of the above
Q 13. What is the purpose of the Guaranteed Insurability Option rider?
A) Provides additional benefit over the base policy cover amount
B) Provides a monthly income benefit in case of disability
C) Waives off the premium payment during disability
D) Allows increasing the insurance coverage without further medical examination
E) Specifies a fixed monthly disability income benefit amount
Q 14. What is the purpose of the receipt book issued to policyholders?
A) Proof of premium payment
B) Record of policy details
C) Tracking investment returns
D) Claim settlement documentation
E) Policyholder's contact information
Q 15. What happens to the share of beneficiaries who die before the policy becomes a claim under the MWP Act?
A) It goes to the surviving beneficiaries
B) It becomes void and cannot be claimed
C) It is distributed among the legal representatives of the deceased beneficiaries
D) The policy is terminated and no claim can be made
E) It is given to the insurance company as a surrender value